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Old 02-19-2015, 03:59 PM   #21
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Seems I went to the wrong university
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Old 02-19-2015, 04:27 PM   #22
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Not to mention the favorite young person's hobby-copious sex with as many attractive partners as you fancy. Anyone who lives in the real world can testify that it would be essentially impossible for a man at least to replace that, for free or almost any realistic amount of money.

Ha
Ah, the 70s, when anything you caught could be cured with penicillin. It'll never be like that again.

I thought of going to law school after I got my Math degree and chose not to because I was tired of living like a student. I was living off my parents and sharing a squalid Victorian house with an assortment of people my age, some of whom were not serious students. I wanted a car, I wanted to see Europe, I wanted my own little apartment, so I got a job. I managed to get to Europe the first time by setting a goal of saving twice what the cost of the trip would be. That was helped by not going overboard on a car (although I should have done better than that used 1973 Hornet).

I agree with his basic premise, though: you don't have to drop all of your thrifty habits just because you're making money.
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Old 02-19-2015, 04:48 PM   #23
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This is not new news. So much of this stuff is just rehashed, repackaged, and resold (witness Anthony Robbins' latest book and the ensuing criticism).

Mr. Money Moustache does a better job of showing people how to be frugal.
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Old 02-19-2015, 05:32 PM   #24
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This is not new news. So much of this stuff is just rehashed, repackaged, and resold (witness Anthony Robbins' latest book and the ensuing criticism).

Mr. Money Moustache does a better job of showing people how to be frugal.
That is interesting because when I saw the video I thought the low kinds of rates of return to expect going forward that Shiller suggests to plan on and the kind of housing college students usually live in were pretty different from the kind of housing and expected future returns discussed in the MMM blog (not the forum - a lot of people who post there do seem to live like extended college students, living in low overhead apartments with roommates or significant others).
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Old 02-19-2015, 05:37 PM   #25
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Not to mention the favorite young person's hobby-copious sex with as many attractive partners as you fancy. Anyone who lives in the real world can testify that it would be essentially impossible for a man at least to replace that, for free or almost any realistic amount of money.

Ha
Looks like I went to the wrong Ivy League school.

I went to the University of New Haven which is a stones throw from Yale. The only thing I got to do was go to Yale's bookstore since we didn't have one. Oh, and I did heat beans on a steam radiator.
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Old 02-19-2015, 07:38 PM   #26
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That's where we are too. After I retired I could easily have found a mid-six figures job and most of the guys working in that field did so.
Out of curiosity which field to which you refer pays $400k-$600k per year?
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Old 02-19-2015, 07:51 PM   #27
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Robert Shiller has some interesting thoughts on savings and retirement for his students:

The investing golden age may be over: Robert Shiller | Watch the video - Yahoo Finance
He advocates saving more. Here's an app that would help people to save.
A 29-year-old invented a painless way to save money, and Google's buying into it!

It seems to be just another entrepreneurial idea to make a lot of money. This 29-year guy is amazing in making it big.
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Old 02-19-2015, 07:56 PM   #28
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He advocates saving more. Here's an app that would help people to save.
A 29-year-old invented a painless way to save money, and Google's buying into it!

It seems to be just another entrepreneurial idea to make a lot of money. This 29-year guy is amazing in making it big.
"But there's a catch: Users do not earn any interest on their savings."

It is like the high tech version of a Christmas Club Account! - forced savings and no interest, but some people who might otherwise fritter away the money will benefit from the structure.
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Old 02-19-2015, 08:22 PM   #29
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"But there's a catch: Users do not earn any interest on their savings."
That's how Digit makes money - keeping the interests, I think. They might receive fee or commission from the two banks.
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Old 02-19-2015, 08:42 PM   #30
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That's how Digit makes money - keeping the interests, I think. They might receive fee or commission from the two banks.
I'm reading a book now called Incognito: The Secret Lives of the Brain and the logic was the same from the Christmas Club Accounts, started in 1909. People willingly gave up the interest they could have earned in order to grant someone else the power to prevent them from making impulsive decisions with their money, so they would have the money they needed for gifts saved up at Christmas time. Banks loved the concept. It was free money for them to invest the rest of the year.

So here is a concept from 1909 made into an app.
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Old 02-19-2015, 08:59 PM   #31
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Not to mention the favorite young person's hobby-copious sex with as many attractive partners as you fancy. Anyone who lives in the real world can testify that it would be essentially impossible for a man at least to replace that, for free or almost any realistic amount of money.

Ha

Tell me about it, Ha. I didn't marry until 30, but it was a lot less work accomplishing the task at hand living in the frat house as it was in the bars after graduation.


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Old 02-20-2015, 12:25 AM   #32
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This similar to my bare bones budget if DW and I are reduced to just SS except I can live much larger on our combined SS than I ever did as a student. I could do better than my student days on just my SS.
About six months into ER, I have to say it does feel a bit like returning to a simpler student lifestyle, but better (no hormone-crazy roommates, for one thing).

It's been reassuring to realize that I can live on less than I anticipated. And, like you, I think SS will cover the bare-bones budget, taking a lot of the pressure off. SS is still quite a few years away for me, though, so the most important thing is to make it safely from here to there.
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Old 02-20-2015, 08:26 AM   #33
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People willingly gave up the interest they could have earned in order to grant someone else the power to prevent them from making impulsive decisions with their money, so they would have the money they needed for gifts saved up at Christmas time. Banks loved the concept. It was free money for them to invest the rest of the year.
Same with the IRS and tax refunds. Woo-hoo! I got a big refund! (Or, my pet peeve, "I got a big tax return!") Now I can buy a bigger TV!

As a taxpayer, I thank you for your interest-free loan to the US government.
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Old 02-20-2015, 09:05 AM   #34
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Same with the IRS and tax refunds. Woo-hoo! I got a big refund! (Or, my pet peeve, "I got a big tax return!") Now I can buy a bigger TV!

As a taxpayer, I thank you for your interest-free loan to the US government.
That was actually the second example in the book of using an out of body mechanism for controlling potentially impulsive behavior of one's future self, at least until tax return time.
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Old 02-20-2015, 10:34 AM   #35
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Shiller's advice to young workers to be frugal is not new. What I find more noteworthy is is his gloomy outlook about future investment returns.

In the example he describes, a person saving 5% while working can expect to have post-retirement spending of 5% of his previous income, if his retirement years are as long as his working years. Why? Because his investment return barely lets him catch up with inflation.

Such gloomy outlook from a Nobel laureate is noteworthy, don't you think?
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Old 02-20-2015, 10:45 AM   #36
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Shiller's advice to young workers to be frugal is not new. What I find more noteworthy is is his gloomy outlook about future investment returns.

In the example he describes, a person saving 5% while working can expect to have post-retirement spending of 5% of his previous income, if his retirement years are as long as his working years. Why? Because his investment return barely lets him catch up with inflation.

Such gloomy outlook from a Nobel laureate is noteworthy, don't you think?
I think he is careful to say he of course cannot predict the future, but has a hope for the best but prepare for the worst pragmatic type of advice, based on possible current potential bubble signs. I thought he came off well compared to some of the other less pragmatic and more formula oriented economists in the Nova show Mind Over Money:

NOVA | Mind Over Money

After I watched that I started paying more attention to what he predicts and recommends for investments.
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Old 02-20-2015, 01:25 PM   #37
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The question for me about Shiller is : does he take his own advice?
He apparently took his Nobel winnings and bought a Connecticut beach house in 2003.
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Old 02-20-2015, 02:11 PM   #38
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The question for me about Shiller is : does he take his own advice?
He apparently took his Nobel winnings and bought a Connecticut beach house in 2003.
In the articles I've read he doesn't tell people to buy or not buy houses - he just says that historically they usually keep pace with inflation so they may not be the great investment many think they are.

http://finance.yahoo.com/news/we-re-...174038372.html

"There is an argument for helping low-income people get a house,” says Shiller. “I think it makes them feel better about their attachment to this country and themselves.” But he doesn’t believe there’s any reason to advise people towards owning a house instead of starting a business or paying for an education.

Owning a home appeals to certain people, according to Shiller, people who are upwardly mobile with young children. But, he warns, owning a home is an incredible nuisance that can trap people and end up costing a lot in upkeep. “I’m a homeowner but there’s a lot of stuff that goes wrong, we had our heat go out the other day,” he jokes."
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Old 02-20-2015, 03:40 PM   #39
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Out of curiosity which field to which you refer pays $400k-$600k per year?
Oops, bad phrasing on my part. I meant in the $150k/year range.
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Old 02-20-2015, 04:09 PM   #40
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Please don't make me eat those generic frozen pot pies every day for dinner again!
I liked the Swanson pot pies.

My college daze diet consisted of Kraft Mac and Cheese, various flavors of canned soup over white rice or pasta, and when I got my Work-Study check...chicken and veggie based casseroles, with canned cream of mushroom/chicken/celery soup as the gravy.

PB and jelly or cheese sandwiches with lettuce was my take-to-campus lunch. Once in a while I could afford the pizza and sub shop.

I tried the Ramen noodles but found it too salty.
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